Arizona House Bill 2280, which is intended to increase electronic filing and payment of business taxes, takes effect today. The bill, which features a multiyear phase-in period, mandates that businesses file and pay transaction privilege taxes (TPT) electronically. The bill also requires the annual electronic filing of corporate income tax, fiduciary, and partnership returns starting in tax year 2020.

The bill phases in the electronic filing and payment requirement based on the business’s prior year TPT liability as follows:

TPT Liability in Prior Year Electronic Filing Required By Date
$20,000+ 1/1/2018
$10,000 - $19,999 1/1/2019
$5,000 - $9,999 1/1/2020
$500 - $4,999 1/1/2021

Other highlights of the legislation include the following:

  • Increasing the amount of the credit for accounting and reporting expenses to up to $2,000 annually
  • Requiring individual income tax return preparers that prepare more than 10 returns during any taxable year to file all returns electronically
  • Expanding the ability of electronic filing and payment for luxury taxes, such as the tobacco and alcohol taxes